First Thoughts: Battling over the Bush tax cuts (again)

The Daily Rundown's Chuck Todd talks about the announcement President Barack Obama will make asking for the one-year extension for people earning less than $250,000 a year.

Battling over the Bush tax cuts (again)… For Obama, this is both an opportunity (creates contrast with Romney) and a challenge (we’ve already been down this road before)… But have the Bush tax cuts actually worked?... Democrats blast Romney’s offshore accounts… House GOPers put pressure on House Dems… Boehner: The American people probably won’t fall in love in Romney… And has health care already disappeared from the campaign trail?

By NBC's Chuck Todd, Mark Murray, and Natalie Cucchiara

*** Battling over the Bush tax cuts (again): The last time we left you on this topic was back in late 2010, when President Obama agreed to temporarily extend the Bush-era tax cuts for all income groups -- including the wealthy -- which he had campaigned against in ’08. That move disappointed his base, but it also won him GOP concessions (on payroll tax cuts and unemployment insurance), and it paved the way to repeal “Don’t Ask, Don’t Tell” and approve the New START treaty. But the president vowed not to extend the tax cuts for the wealthy at the end of 2012, when he would have more leverage (because it would be after his re-election bid). “When they expire in two years, I will fight to end them,” he said at a Dec. 7, 2010 press conference. And today, Obama makes his first chess move in this new tax-cut battle: At a White House at 11:50 am ET, the president will call for a one-year extension of the tax cuts for ONLY those making less than $250,000. House Republicans, the New York Times notes, plan a vote later this month to extend the tax cuts for ALL income groups.

*** Obama’s opportunity and challenge: For Obama, today’s move allows him to change the subject after Friday’s weak jobs report. Perhaps more importantly, it enables him to draw a contrast with the Republicans and Mitt Romney, who just yesterday was raising money from wealthy folks in the Hamptons and who had spent his July 4 vacation at his New Hampshire lake house. But this is also dangerous ground for the president. We’ve been down this road before, and Obama has already caved once. The reason: Unlike Republicans, Democrats aren’t unified on this issue. Some of them want the threshold to be $1 million; others are open to extending them TEMPORARILY for the wealthy. This time around, Obama has much more leverage -- with the expiration coming after the election -- but he still faces the situation where not all Democrats are unified. Here’s what we’re watching for today: Does he draw a line in the sand that he would VETO any legislation that extends all of the tax cuts? He’s said before he opposes extending them for those making more than $250,000. He said in 2008 and in 2010 and yet he extended ALL of them in 2010. But what does he say this time?

*** Have the Bush tax cuts worked? Here’s an entirely different question: Have these tax cuts worked? Have they promoted economic growth? Have they created lots of jobs? The Bush-era tax cuts have been in existence for 11 years now. During that time period, George W. Bush presided over the weakest eight-year span for the U.S. economy in decades; the Great Recession took place; and job creation during Obama’s presidency has been lackluster. In this renewed debate over the Bush tax cuts, we’re going to hear Republicans claim that not extending them -- especially for the wealthy -- will hurt the economy. And we’ll hear the same from Obama when it comes to extending them for the middle class. But what evidence is there that these tax cuts have truly benefited the U.S. economy? This is one of these accepted pieces of conventional wisdom that doesn’t get much study on the policy front because, politically, it’s so lethal.

*** Democrats blast Romney’s offshore accounts: Just 48 hours after Friday’s bad jobs report, Democrats were engaged in a full-out assault on Romney’s offshore accounts. (Coincidence?) Here was DNC Chair Debbie Wasserman Schultz on FOX (at the end of her interview): “I'd really like to see Mitt Romney release more than one year of tax records, because there's been disturbing reports recently that he's got a Bermuda corporation, a secretive Bermuda corporation that no one knows anything about.” Sen. Dick Durbin on CBS: “[Romney] is the first and only candidate for president of the United States with a Swiss bank account with tax shelters, with tax avoidance schemes that involve so many foreign countries.” Gov. Martin O’Malley to ABC: “Mitt Romney bets against America. He bet against America when he put his money in Swiss bank accounts and tax havens and shelters.” And Robert Gibbs -- who has been one of the Democrats’ best TV surrogates -- to CNN: “I pick a bank because there is an ATM near my home, but Mitt Romney had a bank account in Switzerland.”

*** How does Team Romney respond? This was clearly a coordinated assault -- and a reminder that when the economic news is not good, the Obama campaign has little choice but to go down this road. For now, the Romney response is simply, “They are trying to distract from the bad economy,” which has the added benefit of likely being true… But the other fact is these relentless attacks by Team Obama on Romney’s business career have started to take a toll. Will the attacks on his personal wealth also take a toll before the Romney campaign figures out a better way to respond?

*** House GOPers to put pressure on Dems: While Obama and Democrats are making their move on the Bush-era tax cuts, House Republicans are planning votes over the next four weeks to give Democrats heartburn. Politico: “House Republicans will kick off the effort this week with another quixotic attempt to repeal Obama’s health care law. Next week, they will turn to defense, passing the Defense Department’s funding bill while trying to put the Obama administration on record as having no plan to avoid deep cuts to the Pentagon next year. After that, Republicans intend to take up a slew of regulatory relief bills. And before the House breaks in August for its monthlong recess, GOP leaders plan to hold a vote on tax rates and principles for future tax reform.” Make no mistake, these votes are about writing TV ads and direct mail pieces. Meanwhile, the DCCC is up with a new online advertising campaign hitting GOP efforts to repeal the health-care law.

*** Boehner: “The American people probably aren’t going to fall in love in with Mitt Romney”: Speaking of House Republicans, don’t miss this quote from Speaker John Boehner (at a June 30 fundraiser in West Virginia): “The American people probably aren’t going to fall in love with Mitt Romney.” He went on to say, per Roll Call: “I’ll tell you this: 95% of the people that show up to vote in November are going to show up in that voting booth, and they are going to vote for or against Barack Obama. Mitt Romney has some friends, relatives and fellow Mormons ... some people that are going to vote for him. But that’s not what this election is about. This election is going to be a referendum on the president’s failed economic policies.” We’ll say this: John Boehner hasn’t fallen in love with Romney, either…

*** Health care has already disappeared from the radar screen: A final observation: Have you noticed how no one is no longer talking about health care? It’s either Friday’s job numbers. Or Mitt Romney’s wealth. Or the new battle over the Bush tax cuts. Yes, House Republicans will schedule their vote -- again -- to repeal the health-care law, and the DCCC has that online advertising campaign mentioned above. But outside of these things, is the issue slowly disappearing from the presidential campaign trail beyond being an applause line? It sure looks like it this morning.